Panasonic Executives: Huge Fine and Jail Time

Japanese electronics giant Panasonic will plead guilty to US government charges that the company conspired to fix prices in two major markets: laptop battery packs and auto parts. Panasonic has agreed to pay $56.5 million in total fines for the two separate conspiracies and 15 executives at several companies will be serving jail time as part of the deal, the Justice Department announced last week. When it comes to the auto parts portion of the conspiracy, Panasonic’s price-fixing is reported to have gone back at least 15 years, to 1998.

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“RESULTED IN INFLATED PRODUCTION COSTS FOR NOTEBOOK COMPUTERS AND CARS.”

That’s when Panasonic is said to have worked with other companies behind the scenes to “fix, stabilize, and maintain the prices” of lighting equipment (HID ballasts) sold to Honda, Mazda and Nissan. But that’s not all the company was up to when it came to the auto market: it also worked with fellow corporations to fix the prices of switches and sensors for auto steering wheels, doors, wipers, turn signals and other key parts of a car’s control system, that were sold to Toyota. The Justice Department said that this switch price-fixing conspiracy lasted from at least 2003 to 2010.

Such price fixing tendencies weren’t limited to the auto market, unfortunately. Another Japanese electronics maker, SANYO Electric, which Panasonic acquired for $4.5 billion in 2009, was charged working together with Korean rival LG Chem to fix the prices of cylindrical lithium ion battery packs for laptop computers worldwide. The conspiracy, which included these competing companies agreeing to sell batteries at the same prices to computer companies, took place from at least 2007 to 2008, according to the Justice Department. It’s unclear from the DOJ’s statements exactly which of Sanyo’s battery pack models were affected by the price fixing, but the government is touting the bust as a win for consumers. “The conduct of Panasonic, SANYO, and LG Chem resulted in inflated production costs for notebook computers and cars purchased by U.S. consumers,” said Joseph S. Campbell, an FBI official involved in the investigation, in a statement released Friday by the Justice Department.

Via:theverge

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